Donohoe Tapped as Irish Finance MinisterBy
Former European Affairs minister takes over as economy booms
Donohoe will decide Allied Irish Banks share sale price
Paschal Donohoe was appointed Ireland’s new finance minister, as a new generation of politicians moved center stage in one of Europe’s fastest-growing economies.
Irish Prime Minister Leo Varadkar, who took office in Dublin on Wednesday, appointed Donohoe, 42, to replace Michael Noonan, 74. The Dubliner, first elected to parliament in 2011, served as Public Expenditure & Reform Minister for the past year.
“His appointment will not make too much difference - the transition should be smooth,” Alan McQuaid, chief economist at Merrion Capital in Dublin, said. “He has tough shoes to follow but he seems pretty capable.”
A former European Affairs Minister, Donohoe takes over as the shadow of Brexit looms, with Ireland considered to be the European economy most vulnerable to a U.K. exit from the European Union. In the short-term, his biggest decision will center on pricing the sale of 25 percent of Allied Irish Banks Plc, slated to be the largest IPO in London this year. The proceeds are due to be used to cut the nation’s debt.
“Fiscal responsibility and making sure we make right long term decisions, ” Donohoe said in Dublin before his appointment. “That’s not going to change, it can’t change.”
The stock may eventually price at about 4.50 euros a share, raising around 3 billion euros, according to a person familiar with the process, though the final figure will be determined by demand.